USDT Migration Guide
USDT Migration on Sei: Kava USDT to USDT0
Overview
On Sei Mainnet, there are currently two types of USDT:
Kava USDT: Bridged via IBC from the Kava blockchain.
USDT0: 1:1 backed by Ethereum-native USDT, bridged via LayerZero’s OFT standard.
Both are usable today, but USDT0 is becoming the new standard across the Sei DeFi ecosystem.
Understanding the difference
Origin
Ethereum-native USDT
Bridge from Kava
Bridging Method
LayerZero OFT (Omnichain Fungible Token)
IBC
Backing
1:1 backed by locked USDT on Ethereum
Backed by Kava USDT in a Kava smart contract
Cross-Chain Support
Seamless via LayerZero
Limited to IBC-compatible chains
Preferred Ecosystem
✅ Yes
❌ Deprecated
Redeemability
Can redeem for USDT on Ethereum
Not redeemable outside Kava
Why migrate to USDT0?
Protocols on Sei (including Yei Finance) are adopting USDT0 as the primary stablecoin because of its:
Direct backing by Ethereum USDT.
Native compatibility with omnichain transfers (via LayerZero).
Stronger oracle and tooling support.
Simpler and safer app integrations.
Future-proof ecosystem compatibility.
USDT0 will be the default stablecoin for lending, swapping, and ecosystem-wide incentives on Sei.
How to migrate?
You can migrate to USDT0 through two main methods:
Frequently Asked Questions
Q: Do I have to migrate?
A: No. Kava USDT will remain accessible on-chain. However, most protocols will reduce support for it, and you may face limited incentives or fewer liquidity options over time.
Q: Is Kava USDT going away?
A: No, it will continue to function but will no longer be the default across the Sei DeFi stack.
Summary
USDT0 is the official stablecoin standard on Sei.
Migrating ensures access to better DeFi opportunities, cross-chain compatibility, and ecosystem-wide support.
For the best experience and compatibility, use USDT0 going forward.
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